Rajin-Sonbong a Weird Oasis in the N.Korean Desert

North Korea's Rajin-Sonbong special investment zone is booming, in stark contrast to other towns in the impoverished country.

A survey by the Institute for Peace and Unification Studies at Seoul National University of 200 North Korean defectors who left the North in 2012 and this year showed that Rajin-Sonbong is the place where most North Koreans dream of living.

One defector who fled the special economic zone this year said, "Taxis race across newly-built roads, while apartments are being constructed everywhere." The defector added the bright neon signs at night resemble capitalist cities.

Around 150 joint ventures with Canadian, Chinese, Japanese and Russian businesses operate in Rajin-Sonbong. Dining out costs a whopping US$16 per person, and around 80 percent of people have a mobile phone. Foreign currency is the normal tender.

Prostitution is rife, and though security forces try to clamp down, visitors say authorities are often bribed to look the other way and some have even taken to pimping for Chinese businessmen.

Increasingly, the foreign businesses there hire workers directly to bypass the constant meddling of party officials if they go through the legal channels.

These developments are making the regime nervous, so it has reduced access for ordinary North Koreans to the zone, which is increasingly cut off from the rest of the country.

Jang Song-taek, who is seen as the eminence grise behind the North Korean leader, toured Rajin-Sonbong last month and warned it has become a "rotten hotbed of capitalism" and ordered authorities to restrict access.

But despite that, Rajin-Sonbong remains a rare success story among a spate of dismal failures. Four special economic zones and 14 smaller development zones were touted by North Korean leader Kim Jong-un as future growth engines shortly after he succeeded his father to the throne in 2011.

Other special economic zones are the river island of Hwanggumpyong in North Pyongan Province and Kangryong in South Hwanghae Province. The North also designated 14 development zones in nine cities and provinces and solemnly established a state committee to oversee their development.

The North sought Chinese investments for Kangryong in 2011, shutting down around 500 local businesses and invited Chinese investors to tour the area. But the Chinese government in July last year concluded that its port facilities were poor and infrastructure too underdeveloped for investment.

The Hwanggumpyong special economic zone has also seen hardly any development after Beijing said the matter was entirely up to individual investors.